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Economists: Higher retirement age ok for certain sectors only

Malaysia office

Ahirul Ahirudin
Written by Ahirul Ahirudin

KUALA LUMPUR – September 3, 2019: Economists are of the view that any increase in the retirement age to 65 should only be considered for certain sectors.

It is also their view that such a move will not help the lower income group much as recently claimed by the Malaysian Trade Unions Congress (MTUC).

Yesterday, the government said it will study the proposal from the MTUC.

Associate professor Dr. Ahmed Razman Abdul Latif of the Putra Business School, Universiti Putra Malaysia, argued that the proposal is not going to fully alleviate the hardship faced by the lower income group.

If a job requires a lot of physical activity, an increase in retirement age will make it worse for the elderly because they will be more prone to injury or sickness, he said.

Razman also thinks that increasing the retirement age will negatively affect the employment prospects for young people due to stiffer competition for jobs.

“Singapore increased its retirement age to 65 because of a falling birth rate and difficulty in getting foreign labour. We do not have that problem, so it is better not to increase the retirement age unless there are not enough talents.

“The government should only allow the increase for certain sectors that do not have enough talent replacement,” said Razman.

His opinion was echoed by Professor Dr. Faridah Hassan of Universiti Teknologi Mara who believes that the proposal is suitable only for selected highly professional groups.

“What the B40 workforce needs is an upscaling programme to upgrade their career development.

“At the age of 60 or 65, we should retain only those who are healthy and highly connected to assist in developing the country,” said Faridah.

While on a visit to Cambodia, Prime Minister Tun Dr. Mahathir Mohamad today said there is no need to increase the retirement age because doing so would be to allow the deadwood to simply sit in their chairs and deprive others of a promotion.

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Ahirul Ahirudin

Ahirul Ahirudin